IDEAS home Printed from https://ideas.repec.org/h/pal/palchp/978-0-230-37385-3_5.html
   My bibliography  Save this book chapter

The Invisible Hand Versus the Visible Hand

In: Korean Economic Dynamism

Author

Listed:
  • Dilip K. Das

    (Ecole Supérieure des Sciences Economiques et Commerciales)

Abstract

Adam Smith reacted against any ideas that supported the use of political power to achieve economic ends and dismissed them as mercantilistic. Since he invented the term ‘invisible hand’, economists have debated over the strengths and limitations of the market forces. The Smithian vision of the invisible hand treated markets as complete; all market information, according to him, was summarised in prices. But his vision is shattered when a decision unit, or an economic agent, has the market power.1 By market power I mean a situation in which an individual’s action can influence the equilibrium prices. This vision is also affected by what Fred Hirsch calls the ‘positional good’. Many sources of economic advantage depend on the relative position of a person vis-a-vis others, like someone holding an important job or having access to an uncrowded beach. Since the total supply of positional good is fixed, ‘what winners win, losers lose’. There is little scope for the market to enhance efficiency.

Suggested Citation

  • Dilip K. Das, 1992. "The Invisible Hand Versus the Visible Hand," Palgrave Macmillan Books, in: Korean Economic Dynamism, chapter 5, pages 141-158, Palgrave Macmillan.
    • Handle: RePEc:pal:palchp:978-0-230-37385-3_5
    DOI: 10.1057/9780230373853_5
    as

    Download full text from publisher

    To our knowledge, this item is not available for download. To find whether it is available, there are three options:
    1. Check below whether another version of this item is available online.
    2. Check on the provider's web page whether it is in fact available.
    3. Perform a search for a similarly titled item that would be available.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:pal:palchp:978-0-230-37385-3_5. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.palgrave.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.